Mandated lead arrangers ABN Amro, Calyon, Citi and Commerzbank are set to launch syndication in the next week on a new US$2.2bn syndicated loan facility for Gazprom Neft, the oil arm of the Russian state-owned company Gazprom. It is being used to finance upstream and downstream business expansion.
The three-year amortising facility pays 75 basis points, a significant rise in pricing when compared to the borrower’s previous transaction raised in 2006, which featured a tranche paying 60bp.
Those working on the deal report that the pricing reflects the current climate in the markets, and will be one of the first deals to reverse the downward spiral in pricing seen in both the Russian and global markets over the last few years.
The deal is expected to be well-received by the market, with banks potentially keen to participate in a deal that pays a margin almost double that of Gazprom’s previous syndicated facility. Gazprom tapped the market in the first half of the year, with a syndicated facility featuring a three-year tranche paying a 40bp margin and a five-year tranche paying 50bp.
Gazprom Neft is a vertically integrated oil company in Russia, comprising oil production, refining and marketing. It is the fifth largest oil company in Russia as measured by oil production. It has been granted a rating of BB+ by Standard and Poor’s .